Net Investment Income (NII)

Private Credit Glossary

A BDC's core recurring earnings: NII = Total Investment Income - Operating Expenses - Interest Expense. The primary source of BDC dividend payments and the key metric for evaluating dividend sustainability — if NII per share falls below the declared dividend, the dividend is being funded from realized gains or returns of capital, an unsustainable bridge. NII excludes realized gains/losses (one-off) and unrealized depreciation (non-cash).

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